Tencent to invest $500M stake in restaurant rating site
Tencent Holdings is reportedly eyeing a stake in Chinese restaurant ratings site, Dianping, in a deal estimated to be worth up to US$500 million.
The Internet giant would purchase 20 to 25 percent shares in the lifestyle website with an investment of between US$400 million and US$500 million, according to a China Daily report. Similar to popular U.S. restaurant reviews site Yelp, Shanghai-based Dianping has over 90 million active monthly users posting more than 30 million reviews.
The report noted that representatives from both companies declined comment, but sources revealed an official statement was scheduled to be released tomorrow.
If true, the deal would put to rest previous rumors that Tencent's rival, Baidu, was in discussions to buy out Dianping. The reviews site's founder and CEO, Zhang Tao, said last year he planned to take the company public within five years for an estimated valuation of at least US$10 billion. Zhang also told local media he would consider investment bids that were "reasonable" and beneficial to both parties involved.
China's major Internet players, including Tencent, Alibaba, and Baidu, have been making several aggressive moves and investments in efforts to bolster their market footprint, including expanding their presence into the offline business. Tencent just last month said it would invest US$193.45 million for a 9.9 percent stake in logistics company, China South City Holdings, to support its e-commerce business.
Alibaba last week offered to buy out the remaining sharesin Chinese digital mapping and navigation company, AutoNavi, in a deal projected to be worth US$1.1 billion. The deal could potentially allow the company to integrate data into maps, offering more relevant information to users as well as providing a way to promote Alibaba's e-commerce merchants and related services. The e-commerce giant operates e-commerce sites Taobao and Tmall, and is prepping its first U.S. shopping website, 11 Main.